Pool Re has hailed the UK Government’s commitment to amend the 1993 Reinsurance (Acts of Terrorism) Act to enable the reinsurer to extend its cover to include non-damage business interruption losses resulting from acts of terrorism.
The reinsurer is currently restricted by the 1993 Act to only pay out if physical damage has occurred to commercial property. This means that businesses, inside a police cordon, that suffer financial loss through being unable to access their property or to trade, are only covered if there has been physical damage during a terrorist attack.
Pool Re said that the recent terrorist attacks in Westminster, Manchester and London Bridge highlighted the actual impact of the gap in UK provisions for terrorism insurance coverage, fuelling its decision to extend its cover further.
In November 2017, Pool Re announced that it will extend its cover to include material damage and direct business interruption (BI) as a result of cyber terrorism from April 2018.
Pool Re CEO Julian Enoizi said: “We welcome and applaud the Government’s commitment to amend the 1993 legislation to allow Pool Re to be the first of the global terrorism pools to overtly extend its cover to include terrorism related non-damage business interruption.
“After months of extensive collaboration between ourselves and the Government, today’s announcement represents another landmark moment for the insurance industry’s ability to provide a comprehensive response to acts of terrorism in the UK and demonstrates the strength of public/private partnership in disaster risk financing”.
“This amendment will close the terrorism insurance gap for businesses up and down the country, which, combined with our efforts to make cover more affordable for SMEs and regional businesses across Great Britain, will increase the resilience of the economy. Businesses can be confident they will be covered in the event of a terrorist attack, and able to get back on their feet quickly for the benefit of their community, customers and suppliers,” he added.